European accelerators invested €39m in 1,588 start-ups in 2014

7 May 2015

Accelerators have proven themselves to be a vital source of funding for European start-ups

The total amount of investment in European accelerator-based start-ups during 2014 stands at €39.5m, according to new data from Fundacity. Ireland is in the top 10 of accelerator-based investment in Europe.

The €39.5m has been invested in 1,588 start-ups engaged with 76 accelerators, according to the 2014 Fundacity European Accelerator Report.

The UK tops the investment ranks with €13.2m invested in 599 start-ups, followed by Spain with €6.2m in 101 start-ups, and Germany with €2.9m invested in 59 start-ups.

Ireland ranks in eighth place with €1.8m invested among 81 accelerator start-ups in 2014.

Ireland’s NDRC ranks alongside Wayra, Lanzder, Eleven, European Pioneers, Collider, Accelerace, Rockstart and TractionTribe among the most active accelerator-based investors in Europe in 2014.

Approximately €860,000 was invested by the NDRC in its accelerator companies last year, according to the Fundacity report.

The accelerator revolution in Europe


Fundacity European accelerator report 2014

Entrepreneurial Spark in the UK was the most active accelerator in Europe, according to the report, with 352 start-ups accelerated, followed by Wayra Europe, with 89 start-ups accelerated, and Euratechnologies, which had accerated 82 start-ups last year.

Dublin’s NDRC was ranked seventh in the top 20 in Europe having accelerated 44 start-ups during 2014.

The first accelerator to be founded in Europe was Seedcamp, which was formed by a group of 30 entrepreneurs.

“This surge in the number of accelerators is mainly due to advances in digital technology, which importantly decreased costs of starting a business,” the Fundacity report said.

“As more and more start-ups were created each year, developing effective ways of incubating and supporting them became more relevant than ever. At the same time, the decrease in start-up costs has created the opportunity to invest much smaller amounts of money than previously.”

The typical funding model in Europe consists of the funding of the accelerator itself and the funding available to start-ups.

“We found out that most accelerators followed the traditional model set up by YCombinator of offering a small amount of funding in exchange for equity (typically around 5-10pc).

“These accelerators are most of the time funded with private capital (from angel investors, private investment funds) and aim to generate revenue from follow-on investments in the start-up they support and start-up exits.”

Start-up accelerator image via Shutterstock

John Kennedy is a journalist who served as editor of Silicon Republic for 17 years